Pfizer surges as much as 18% on parent's equity restructuring plans

Shares of Pfizer Ltd, the Indian unit of the world’s largest drug maker Pfizer Inc., rose as much as 18.18% on Monday, the highest since December, to Rs.1,230 apiece on BSE after the company announced an equity restructuring.

Pfizer Ltd said one of its parent’s Netherlands subsidiaries, Pfizer East India BV, will acquire a 60.94% stake in it from Pfizer Corp. and Pfizer Investments Netherlands BV.

This is part of an internal corporate restructuring, the company said in a statement to the stock exchanges. Pfizer Inc. currently holds majority stake in the Indian company through Pfizer Corp. and Pfizer Investments Netherlands.

As per the proposed equity restructuring, Pfizer Investments will sell 8.8 million shares in Pfizer Ltd at Rs.1,537 a unit, and Pfizer Corporation will transfer 9.39 million shares in the Indian company free of cost to the parent.

The shares transfer price in the case of Pfizer Investments will be at a premium of not more than 25%, the company said.

The Indian drug maker, in which the parent made a share buyback in 2012, had in December said it was realigning the local management in sync with the global parent’s new business focus.

As part of this, the company will create five main business segments—established products or branded generics, innovative drugs, vaccines, oncology or cancer drugs and consumer health. Each of these will be led by separate heads reporting directly to the US parent, three people familiar with the development said, requesting anonymity.

The US parent, in its newly restructured business model, focuses on three broad areas—innovative products (mainly patented drugs), established products and VOC (vaccines, oncology and consumer health). The formal division of these revenue units in India and the appointment of the respective heads will be announced soon.

Shares of Pfizer Ltd closed 9.36% higher at Rs.1,138.20 apiece on BSE, while the benchmark Sensex index added 0.53% to 20,811.44 points.

Source: http://www.livemint.com/Companies/XEFambXWxRKmUVKrcsKpyH/Pfizer-surges-as-much-as-18-on-parents-equity-restructurin.html